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  CNN    CNN Newsroom    News/Business. Latest on the day's top news stories  
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    December 30, 2012
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hello, thanks for joining us, i'm martin savidge in for fredricka whitfield. just 31 hours now before the deadline, senate leaders have hit a rough patch in their negotiations. let's go live to dana bash, monitoring developments on capitol hill and dana, while the talks are at a standstill, i can see these trying to talk us to, not sure how this will go. let's try any watch the vn now primarily a part of the negotiations, how did that happen and i can see -- dana, can you hear me all right? >> reporter: yes, i can. sorry about that >> so i was just saying, the vice president now has been called in as part of these negotiations is that inspiration or desperation at this point? >> reporter: um, i would think it's an inspiration but we will have to see. you know, what's going on here appears to be that senator reid, the democratic leader is playing
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bad cop and joe biden is playing good cop. he certainly has a long history of talks and bipartisan negotiations with mitch mcconnell. i want to, over the past hour, we have spoken to two republican senators, i wanted to talk to claire mccaskill, thanks very much for joining us, they just ended their almost two-hour meeting, martin, two hours, what was going on in there behind those door? >> i know you will be shocked to hear that a lot of senators wanted to talk. >> that is shocking. >> everyone wanted to have their same i think the consensus is that we all still want to try to get a deal but some of us are very discouraged that what appears to be on the table now doesn't really do anything to reduce the deficit and this was all supposed to be an exercise in bringing down our deficit and our long-term debt and where we are right now, it doesn't appear that we are getting that done and even more importantly, it appears that republicans are still trying to protect the tippy top as opposed to looking after the greater good of the economy and middle class
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families. >> as far as you-all were told by the democratic leader, where do you think stands -- things stand right now? >> i think that there is a difference in terms of what we think the rates should be for -- and at what point there should be a tax cut and at what point there should be a little revenue that we should collect. there is a difference there. there was a difference about whether or not we should be looking at the social security issue in this discussion. my understanding now the republicans have backed off now, correct, and we are looking at whether or not we are going to end up with deficit and debt reduction and whether or not the changes the republicans are insisting upon are going to comes on the backs of the middle class. >> seine toe, the clock is tick. and i'm sure you heard during your campaign, which you just won, a lot of people saying what is going on with washington? we are so close now this deadline. you can't -- probably hard to put into words how frustrated
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people are are a lot of talking going on and you can't come together with republicans and they can't come together with you to stop taxes from going up for all americans. >> well, the american people in their wisdom sent a divided government to washington. off group of people in the house of representatives that basically slapped around their own leader and said we won't even consider a tax increase for millionaires, multimillionaires, billionaires. meanwhile, you have got the majority of the senators elected in this body saying we can do more at the top end. those of us who have a lot can get more revenue to address this crisis so you have got this stalemate that was created by two very different groups of people, all elected by the american people. >> now, walking out, i spoke to several of your colleagues, democratic senators who said they were not optimistic, really looking pretty glum. what camp are you in after what you just heard? do you think -- i mean, as you said, the clock is ticking, do you think by tonight or
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tomorrow, something will get passed to deal with at least the tax cuts that are going up by most americans? >> most successful businessmen and successful people i have talked to are willing to pay more and so it remains to be seen whether the republicans, being driven by a very extreme group of house members, will allow our economy to hurt because of their desire to protect multimillionaires in this country. i think that is what it is going to boil down to >> taxes are a big issue. the other issue is that we have $110 billion of mandatory, pretty draconian, spending cuts that are going to go into place starting on january 1st. do you think that this -- is there any way to put that off or replace it, as far as you're hearing from the talks going on? >> let put this in perspective you 110 billion is a lot for one year, time to deal with after the first of the year, we don't get a deal in the next 24 hours,
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we can make adjustments there, but remember, the funding at the pentagon, without the wars, has doubled in the last ten years and it's a, you know, over 600 billion right now. so, 50 billion out of 600 billion, that's not even 10%. so, i really think we have is to keep perspective. these cuts aren't permanent, we can adjust them after the first of the year, i think we can make adjustments after the first of the year if we don't get a deal, still hopeful we get a deal if we don't, all of us know we can make adjustments. >> senator, thank you vet. i appreciate it. still hopeful, what senator mccaskill just said, martin, i can tell you, as i said, many of the colleagues coming out of the meeting, wrapped up right in there did not have that same assessment, see what happens, back to you. >> dana bash, thank you very much. let's turn now to maine senator olympia snowe. she says it is time to talk about spending cuts and not limit the talk to just the tax hike question. senator snowe joins us now. let me start by asking, are you in favor, senator, of raising
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tax rates on anyone making more than $250,000 a year or are you more prone to the $400,000 figure that's been raised? >> well, you know, could i support that but on the other hand, we want to make sure as well not raising taxes on small businesses and there are some audits in the tax code currently between 250,000 and 400,000 that would disproportionately affect those people as opposed to those who make more than 400,000. they would end up -- paying more in taxes than those earning over 400,000. but nevertheless, if the bottom line is that we have to do something to extend the tax cuts for those making 250,000 or less, then certainly, i would support that because we should mitigate and allay the fears of the average american who is worried about facing a major tax increase come the first of the year. >> do you think that this battle, if that's what you you want to call it so far, has been focused too much on taxes? in other words, other avenues
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that need to be explored here as far as saving money, reducing the deficit, that republicans aren't getting a fair shot at? >> martin, it starts with the beginning of this congress that has, you know, basically the last two years, seen historic failure after historic failure regrettably. >> on both party sides? >> on both parties, both branches of government, we are not engaged, wasted time, had recess upon recess, didn't have full workweeks. i mean, the list goes on. and unfortunately, we are in this position today that regrettably imposes a tremendous hardship and burden on the average american. i think there's a serious detachment between washington and the rest of america, frankly. they deal so casually you we will deal with it next year or some other time, not realizing the affects it is having on that person who is worrying, are my taxes going to go up, enough money to pay for my food budget
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or gas budget, whether or not i will have a job or whether or not companies continue to invest and to create jobs, let alone laying off people because they -- of the uncertainty that's been created and created and perpetuated by congress. and all of this could have been avoided. we should have been a very different place, address the very questions that you raised. >> you have been a part of congress, i believe, since is 1978 and as i understand it, this is your last term as senator. you have always been looked at as a voice of moderation here. i'm wondering how do you look at these desperate hours knew we seem to be in and what does it say about our government? >> it's travesty, to be honest with you, martin. i believe in the maximum folks of the united states senate and the founding you fathers designed it to be able to create a consensus and reach accommodation across the aisle. to put the country's interest
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first. a sad truth in terms of where we stand today in terms of our inability to get together and even the most routine let alone the magnitude of the issues we are attempting to address today and will have to address tomorrow. so i'm saddened by it, because i see, you know, the possibilities of what we could accomplish if we were working together and across the political aisle that's what i have done throughout my 34 years. that was part of the decision i made in departing the united states senate, not because i don't love it but because i do, i want to speak out on the outside and encourage people to do everything they can to make elected officials accountable in realtime to do their jobs. we shouldn't be in this fiscal cliff today. we shouldn't have had sequestration and automatic cuts. we shouldn't have had the debt controlling debackle. all that was manufactured by the
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united states congress. and so i'm sanded by where we stand. >> can i ask you this is with all respect is there a concern that perhaps you're almost bailing at a time when your moderation is needed most? >> i think it is important to have centrist voices in the united states sales in the but given the fact that i have spent 34 years in the united states congress, i thought that in looking over the next six years whether or not it would appreciably change, i didn't think so. i thought it was best to contribute my experience and insiders a voice to match the outsider's frustration and to talk about how it can change and how it used to work i don't see how it changing on the short term, given the partisanship, polarization, putting the political parties first around not the country's interest
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first, the outside groups that you perpetuate division, i thought i could best contribute that way. i want to make a difference so in is the best way i can contribute p >> senator snow, thank you very much. been an honor, as i say, also troubling to hear. thank you. >> thank you, martin. what going over the fiscal cliff means for you. for me. for all of us. we are monitoring the talks on capitol hill, the number two senator on the hill, dick durbin, joins us next. ♪
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[ male announcer ] when diarrhea hits, kaopectate stops it fast. powerful liquid relief speeds to the source. fast. [ male announcer ] stop the uh-oh fast with kaopectate. let's go back to dana bash monitoring developments on capitol hill. dana? >> that's right, martin, talking to democrats now coming out of
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their nearly two-hour meeting talking about the talks are and we now have the number two democrat in the senate, dick durbin from illinois. thank you very much. can you give us a reality check of where things stand and more importantly, if you really think that a deal can be done pie the clock striking midnight tonight or even tomorrow night? >> the original down tours talked about present a problem in reaching an agreement. i understand the conversation is going to continue, as it should, between the leaders in the senate on both sides and the president. >> you have been talking with republican about the big issue appears to be tax rates. how far in these negotiations have democrats been willing to go when it comes to the income
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thresh followed for tax increases? >> i think president obama is right, that those making less than $250,000 should be protected. the republicans, of course, want to raise that level so there it will be some higher income categories that receive the same protection from tax increases. as part of a package, overall package, i'm following sit down and talk about that personally, only one element, the whole question mark tend is what's fair what will reduce the deficit, what's something we can live with as a nation? >> let's talk numbers. you talking about 400,000 dollars a year income level? maybe more? i know republicans are trying to get more than that. >> they are trying to create a larger class of people protected from increase in the income tax beyond the 2% that would have to pay for -- >> what but personally? what could you go for? >> i don't want to bargain with myself here around you can't do it in isolation. what you need look at is the entirely theny of things but got to be willing to give it you know? the nature of this whole process
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compromise, some things which beyond we can't go, period. >> when it comes to compromise, my understanding is that democrats in these negotiations offered to extend part of the estate tax level, relatively low now you 35%, big deal to most republicans and democrats in your own caucus. >> keep in mind, talking about estate tax, one-third of 1% of the people who pass away in america pay this tax, they are the yettiest people. what we are basically saying is let's be reasonable about it but not really give a reward to the wealthiest again who managed to save up a lot of money and want to avoid paying a low tax on it or some tax on it when they pass away. >> give me quickly your prediction. do you think by the end of tonight you and your colleagues are going to be voting on the senate floor on some kind of deal or do you think your going to fall took what the democrats' tax proposal is? >> it will be difficult to put it together this evening, even if we reached an agreement t is more likely to come tomorrow, if
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we reach an agreement. i think we need to keep working at it the american people know what's at stake here. we have a tenuous recovery. we have more people going back to work now, businesses are a little more confident. but this is really important. this fiscal cliff san important element in economic recovery. i hope we can get it done. >> i think everybody out there agrees that they hope you get this done, a lot of frustration out there as you can imagine, i'm sure you hear it as well. thank you. thank you for joining us. i appreciate it. back to you. >> dana bash, as always, appreciate that insight. if the government does go over the fiscal cliff, you know what the rest of the world is going to feel it as well. we will tell you how and where, coming up. ♪ if loving you is wrong ♪ i don't wanna be right [ record scratch ] what?! it's not bad for you. it just tastes that way. [ female announcer ] honey nut cheerios cereal -- heart-healthy, whole grain oats. you can't go wrong loving it.
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all day i we have been following developments on the fiscal cliff talks. right now, senate leaders at an impasse over tax hikes and they are running out of time n just two days, those massive tax hikes and spending cuts will kick n so, let's go now to jessica yellin in washington. jessica has been monitoring events at the white house. you first reported to thanks minority leader mitch mcconnell, vice president bind have been in talks and i'm wondering, with no disrespect to the vice president what can he do? what does he bring? >> reporter: hi, martin. well, he bring morse than 350 years of experience on capitol hill and an ability to make deals. and you know, mick mcconnell, the senate minority leader said he was looking for a dance partner. i guess sort of -- you can think when you get bored dancing with one person, you switch over for a little while and try someone else. i have just been told that at this stage, it is senators
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mcconnell and biden and senator reid who are now again in the talks, sort of collectively so they are all in discussions broadly. and you know, i don't know, this thing has been dead and alive and dead and alive so many times it is hard to sense where the pulse really is but the vibe i'm picking up from the e-mails i'm getting now, there is an uptick in enthusiasm ever so slightly at the moment and some people seem to be a little bit more optimistic that something could come together. so, the headline, if you can tease it out of me right now is that senator reid is in the mix. his team is talking to the biden and mcconnell teams and they are all trying to work something out at this point. >> i'm a little intrigued about the mechanics of how this all works. >> aren't we all? >> i mean is it phone, fax, e-mail? do they meet face to face?
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how does it actually go down? >> reporter: i'm the blast place in earth, probably shouldn't say that on tv, where the blackberry rules. e-mail, a lot of phone, our capitol hill team is up there and they can see when people are actually meeting face to face and trading paper. there is some of that but it's a lot -- a lot less of the old-fashioned stuff. and more of the phone and the e-mail. vice president biden is at the white house, he is at work. and there have been phone calls between the two -- between mcconnell and the vice president and harry reid spoke to the president as well. but you know, everything gets done electronically now, that is how it works, answer to your question. >> jessica, i appreciate it, blackberry probably does too. >> when the blackberry actually works. >> see how this all -- how it all plays out and hopefully soon, jessica yellin, thank you very much. next, more voices and they weigh in on where we stand in this negotiation process. stay here. these new phones they got us are great. yeah, its the galaxy note ii.
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with better mpg. say hi to the all-new 47 combined mpg c-max hybrid. it's crunch time. welcome back. i'm sorry. just 31 hour it is now before that dead light. and here's what we know. senate leaders have hate snag over tax hikes, specifically, who should get them. but lawmakers are still on the hill and they are ready to resume formal negotiations at any time we are told, vice president bind and mitch mccon really speaking and trying to work through that impasse. one topic, two words, dominated the sunday talk shows today. i will give you one guess but
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fiscal cliff. take a look at some of what was said. >> i'm interested in getting a result here. >> i remain hopeful, unrealist buc prospects of reaching a barn agree r >> beyond hope, do you think the chances are good? >> we are not there yet, trying to line up rubik's cube now, we are not there yet. >> the next 48 hours do we have a deal? >> no. >> no deal in the next 48 hours? >> no, i don't think so >> what happens after that? [ no audio ] >> i think the leadership is now working. it will probably be an immediate deal.
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in other words it is not going to solve all the problems forever, but it's gonna solve certain problems. >> what we are seeing here is monumental failure of presidential leadership. the president's the only person with a pen who can sign this and it is the president's responsibility to work on something the house will pass, the senate will pass and the senate will sing. he is outsourcing. this >> the president had put serious spending cuts on the table. answered speaker boehner, a week and a half ago, are this close and then what happens, all of a sudden, speaker boehner decide dodd this plan b. it fell apart and it's leaving us to this last minute. >> automatic cuts, defense cuts, domestic cuts, what's gonna happen to that with this -- are they gonna address that, this deal? >> i was called by leon panetta last night at 7 can 3 0 doubles,ing dinner. >> secretary of defense. >> yes. i was told, lindsey there wouldn't be anything in this deal to avoid sequestration
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going into effect. he says if we do this, it will be shooting the defense department in the head and we will have to send out 800,000 layoff notices the beginning of the year. he is worried to death we don't fix sequestration, we are going to destroy the finest military in the world at the time we need it the most. >> and there you have it, the voice on sunday. there is no deal yet on the fiscal cliff. so what does it all mean for you and your money? well, we will have you back and we will talk about the cutbacks to spending and what it all means to you. we have got the experts to give you some advice. it's our exclusive fiscal cliff roundtable and it's coming up right now on cnn. what a night, huh? but, um, can the test drive be over now? head back to the dealership? [ male announcer ] it's practically yours. but we still need your signature. volkswagen sign then drive is back. and it's never been easier to get a passat.
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it is the one issue that affects just before he single one of us you can the fiscal cliff. think of it as, well this way, our economy is in a car headed toward that cliff and there's a lot of stake, including massive spending cuts and social programs and defense, expiration you the bush era tax cut, increases in other taxes on families like the alternative minimum tax and the expiration of the payroll tax holiday, there's this to think of, for 2 million unemployed worker, the loss of unemployment benefits. we have asked experts to join us for a fiscal cliff roundtable
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discussion, if you will. ron brownstein is a senior -- cnn senior political analyst and editorial director of the national journal and stephen moore, senior economics writer at the "wall street journal" and is in washington, d.c. first up, ron, will, do you think, these politicians reach a deal or not and why or why not? >> the fiscal cliff was yeelted as a doomsday machine to try to give them more will power to do what they can't do on their own, to reach a deal. the reason all of this was here, incentive to reach a deal, some of your guests pointed out during the day, a lot can go wrong when you leave is it to this late, a little little surprising to me republicans don't feel urgency, talk about this in a minute, maybe, the
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wolf on the other side of the cliff, difficult for both sides, the country is worse for the republicans than the democrats. it's possible they make a deal, possible they go over, no more precision than that. >> are we thelma and luiz, rocketing towards that canyon? >> took the words out of my mouth, even if we don't get a deal by the stroke of midnight tonight before the ball comes down on times square, it is not the end of the world, they will reach an agreement some time in my opinion, the next two, three weeks, it will be much better if it happens in the next 48 hours in the next three or four weeks but not like the world's going to come to an end. iri want the cnn audience to know that i agree with ron brownstein, a political point of view, i think republicans may be in a little bit worse shape than the democrats are if we go past january 1st then every day, people are going to be paying higher taxes, the president can
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blame it on the republicans and a lot of this is the reason we don't have a deal is both sides are calculating who -- which side they can blame the other on for this -- for this cliff. >> speaking of the president and -- friday you can the president spoke from the white house, of course, using you the bully pulpit, he was pretty firm about senators getting a deal done. let's listen. >> the american people are watching what we do here. obviously, their patience is already thin. this is deja vu all over again. america wonders why it is that in this town for some reason, you can't get stuff done in an organized timetable. why everything always has to wait to the last minute. people aren't going to have any patience for a politically self-inflicted wound to our economy, not right now the economy is growing but sustaining that trend is going to require elected officials to do their jobs.
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>> stephen, let ask you this, this particular moment, who are the members of congress listening to more, the people, the constituents or the leadership of the respective parties? >> the reason the bill has not been able to pass the house, as you new york the big hangup here is the president wants to raise taxes on people that make over 250,000 and the republicans say that is really louse city for the economy and could cause a double-dip recession if we increase taxes on small businesses and vet. i do think this isn't small ball this is about the ideology of the two parties, democrats say they want to soak the rich with higher taxes, republicans say we don't want to do that and that really is the big hangup right now. >> i do think at the end of the day, maybe the end of this day, but the end of the next couple of weeks, going to reach a deal, probably $400,000 cutoff for the higher tax rates and those spending cuts, by the way, other point we should emphasize is
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that there's two cliffs here, tax increases on january 1st significant reductions in government spending. >> we will pick up this discussion after the break. thank you. like a lot of things, trying to find a better job can be frustrating. so at university of phoenix we're working with a growing list of almost two thousand corporate partners - companies like microsoft, american red cross and adobe - to create options for you. not only that, we're using what we learn from these partners to shape our curriculum, so that when you find the job you want
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okay. there is now, i think you're going to know it three of us, four including me, part of this roundtable as we talk about the fiscal cliff. joining us is todd schnellenberger, let him catch his breath and get seated. talk about what stephen said before the break, not just the fiscal cliff, other big issues congress has to deal with, including a debt ceiling in a matter of weeks, if we can't get past the cliff, i guess what i'm going to ask you, ron is how much hope do we have that congress can tackle these other huge issues? >> well, look, i think that's the big story here. the context wit fiscal cliff and all of this has to be seen. it is whether red america and blue america are following mediate their differences and find reasonable compromises to move forward. we know democrats have won the popular vote five of the last six times for the presidency. they have kind of a structural advantage, i believe, and demographic change. we know republicans have an advantage in the house the way the population distributed.
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we know for at least the next two years, probably the next four years, going to have divide government. none of us are going away and really, you know, watching the inability to make this deal is ominous the next two years because it suggests that neither side, but i think probably more of the republicans, but neither side entirely is fully facing up to the reality of divided government and what that means for having to not get everything you want. and while republicans may believe, as steve said that raising taxes on people over 250 is a mistake, president obama ran very clearly on doing exactly that, won 51% of the vote, 332 electoral college votes, we are probably going to get there the question how much crockery do we break along the way? >> ron that's fine. let's be fair here. we have been negotiating this six weeks, since the election. the president, when i talk to my republican sources say, look, the president hasn't put anything serious on the table still on spending cuts, ron. i think that's, you're right urkts bo, both sides have to give a little bit here, i haven't seen much
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give on the democrats' side of the aisle here. >> the inability to comp prom my keith stone to democrat circumstance todd, why don't you weigh in on this. what is your feelings with what has to be dealt with by not just this congress but 1913th congress, numerology could worry you a little bit. >> stephen hit the nail on the head, talk about the spending cuts, that actually is not even in existence right now you right now you the top line issue has been about tax revenues and increasing those tax and who it is going to him. realistically though, those spending cut russ critical because, like you said i martin, a debt ceiling of $16.3 trillion right now and you have to cut back, the big issue, what makes all of this so complicated is that if you do start cutting back because right now you 25% of gross domestic product comes from government spending so if you do have spending cuts, you have to, therefore, cutting suggesting that is going to reduce gdp, where is the lift going to come from? wall street economists are
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saying, we need the spending cuts, realistically the economy can't handle itself anyway, the democrats are actually using that in their negotiating ploys. >> if you are wall street, what would you say the perfect formula to try to resolve this fiscal cliff issue, todd again? >> let me tell you can the tax issue is such a critical thing on wall street right now. everybody knows once you start taxing the rich, anybody making 250,000 that might seem like rich and middle america. a small business owner right now, the guy that has that corner grocery store, the corner gasoline station, hiring, he is the one passing on that income as ordinary income. so if you hit him, he has more taxes that's less than he can go out and hire. >> todd, but that's just ludicrous, right? we raise tax, we raised the rates in 1939 to 39.6. >> okay. >> 23 million jobs the next ten years, cut the rates under reagan. >> different circumstances. >> we cut the rates -- hold on, todd. >> okay. >> cut the rates under bush, ten years the day tax cuts were passed, fewer people working on
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the day they were passed. idea of marginal rates the past 30 years deet size sive factor how the economy grows or doesn't grow is not supported by the evidence. >> ron, ron, ron -- >> circumstances -- [ overlapping speakers ] >> one at a time here so we can get everybody in. todd, respond to what ron was saying. >> look, different circumstances. during the clinton era, we had great growth going on, you had peace in the world that was taking place. look, we have to enter two world wars two wars, nobody asks for 9/11, obviously in this country, we had to go out and you go out and talk about bush and everything else that happened and the slow growth that owe kaurntd lower interest rates and everything else. realistically, we had to raise our defense budget and everything else that took place, a completely different circumstance in the 1990s as it is now.
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>> we will come back and continue the conversation in a civil way. thank you. and this is the nokia lumia 920 from at&t. it's got live tiles so all my stuff's always right there in real-time. it's like the ultimate personal assistant. but i'm me, and me needs handlers. so i hired todd to handle it for me. todd, gimme that hollywood news! what's happening on twitter? you're trending! yes! you can't have a todd, but you can have your own personal assistant. i guess you could call it todd. [ male announcer ] the new nokia lumia 920 with live tiles that deliver what you want in real time. only from at&t. rethink possible. ♪ [ male announcer ] this is karen and jeremiah. they don't know it yet, but they're gonna fall in love, get married, have a couple of kids, [ children laughing ] move to the country, and live a long, happy life together where they almost never fight about money. [ dog barks ] because right after they get married, they'll find some retirement people who are paid on salary, not commission. they'll get straightforward guidance
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back with our roundtable discussion on the fiscal cliff and your money. ron brownstein is cnn's political analyst and editorial director of the national journey. stephen moore, senior economics writer at the "wall street
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journal" and necessary washington. joining must new york is todd showen berger from land capital. we showed a poll most americans want people to compromise. no purr surprise there why can't republicans and democrats get their act together and compromise? >> well, i think this previous discussion we were just having is kind of an example of what's happening in congress is, you know, democrats, liberal democrats really believe that taxes don't matter around they can continue to raise them as high as they want. i happen to think they are critically important. i think it is insane to be raising taxes on investment and businesses right now i think it will make america less competitive and destroy jobs in this country, but the point is you've got a big philosophical difference of opinion on these things and they are not small matters but big meters of about the direction of our country for the next 10, 20 years. look, it's one thing to get a compromise and an agreement but an agreement that laid the
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country in the wrong direction, that doesn't benefit anyone. >> if we are so passionate in our position and unwilling to give, ron where do we go from here? there is is a structural point you can add to what steve said, exactly right you not small ball it is a big difference. you have districts voting for president obama, districts voted against president obama, in the house, more sorting, fewer legislators, either chamber, elected from chambers who voted for the other party for president, you have a consistent line of political direction, you have republicans from constituent says that really aren't looking for them to compromise overwhelmingly, and democrats the same is. the problem is that while that make senses for any individual legislator, no way to run a country divide ready. in the end, both sides have to give. democrats have to look at more entitlement changes the long run, no other reason it will
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squeeze all out the discretionary spending, the investment is in the future they prefer. republicans also have to kind of understand that we did have an election focus on this issue whether we were going to tax people at the top more. president obama did win 51% of the vote, almost certainly going to happen. as i say you can the problem is for each individual politician, less incentive to compromise, their constituency leans more heavily toward one side or the other. you lean it all up it does produce disfunction in a country still structurally closely divided. >> also still trying to climb its way out of a horrible recession and todd, so, what do you think the reaction on wall street tomorrow morning, the last trading day of the year is going to be? what do we brace ourselves for? that's what i worry about, the economy and the many people whose jobs are really hanging in the balance. >> that's right. we have the jobs report coming out just this friday as well. wall street, right now, short term it is going to be chaotic. we saw it in the final hour of trading on friday, odd number of "headline news" stories coming
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out of the white house based on a meeting that took place as well as the president's comments starting around 3:30. wall street does not like this, they clearly don't like the idea of jumping off the cliff but when you start incorporating higher taxes and even though spending cuts, mentioned before that will take a hit on gdp, none of this is good right now for wall street. so, expect rough sledding going ahead tomorrow. >> stephen what do you think is going to be the final deal that the republicans will accept? >> you know, i think what's going to happen, the likely outcome have some kind of income threshold for these higher tax rates, von right. the president won the election, therefore, he has got the upper hand right now in this and you might see a deal, 400 or 500,000 dollar cutoff in terms of who's, quote, rich in this country, but there might be some deal on -- don't forget, i almost forgot to mention this, we also have the alternative minimum tax, a tax going to hit 26 million people.s go ing the hit 26 million people, and i expect a deal on, that and i think that republicans want to go forward with these spending cuts.
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i don't think that the automatic spending cuts will go through until we reach the broader deal that ron is talking about that is going to come later in the year. >> ron, do you think that we will get the deal done? >> in tend they will fi-- in th will find a way for taxes not to go up on everybody, but it is clear in the last 24 hours the republicans are gearing up for another big fight for the debt ceiling increase in terms of leveraging it further and the spending reductions and the president says he will not play. as difficult as this is, we could be back in two months. >> this is act i. that is what i do see in a couple of weeks that we think that we have dodged a bullet here and got it overwith, but it is only going to return and maybe come back fervently. >> that is right. >> because there could be some anger that now transitioning into the next topic. todd, real quick here, if there was a temporary fix, what would wall street think of that? is that worse? >> actually, that is, because it is worse because it elevates the
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level of uncertainty that wall street hates. >> yes. >> and second of all, it is also going to expectoratings downgrade immediately and talking about wednesday or thursday from a company like s&p and we had that before so realistically, s&p is not going to be happy about this, and this is the last thing that the country needs. wall street wants a complete deal. and realistically, guys, we aret the last hour here. for them to actually have something that is done and then negotiated it and debate it more, i don't see it happening and i don't think that anybody on wall street is either. >> we have to call it there. i want to say thank you so much to the panel. it with was a great discussion and greatly appreciate it it. the time is testy, but we will see what it does to us. >> happy new year. >> and what is the last-minute battle doing to cleng students?
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one says it might change her career path. she and others sound off in a moment. ♪ if you'd like to try and guess ♪ ♪ it is something very special ♪ i would readily confess [ dogs barking ] ♪ 'cause all i want this season ♪ ♪ is something from your heart ♪ la da da, la da da [ male announcer ] thinking of others this holiday season, travelers. well, if itmr. margin?margin. don't be modest, bob. you found a better way to pack a bowling ball. that was ups. and who called ups? you did, bob. i just asked a question. it takes a long time to pack a bowling ball. the last guy pitched more ball packers. but you... you consulted ups. you found a better way. that's logistics. that's margin. find out what else ups knows. i'll do that. you're on a roll. that's funny. i wasn't being funny, bob. i know.
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>> this pig is a sign of riches and strength and fertility and in the new year, you give it to those who you love. >> especially if you touch the buttons on the chimney sweeper's coat. happy new year from germany. regarding the impending fiscal cliff, we have seen a lot coming from washington, but what about the boss? and by that i mean the american people, and they are angry. josh levs is covering that part of the story and he joins us now. >> yes, we are seeing a lot of frustration and anger, and that is a big part of the story in the country right now. we are following a lot of the developments and reading the tea
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leaves in washington, but the fact is that around the country, the mounting frustration and concern about what could happen to you and your taxes and a lot of people are sounding off. we have been getting a lot of videos today and ireport, and take a look at this one. >> my mes sang to all of washington for the new year is partisanship aside and working on fixing this mess that you have gotten us into. and bring a ball lapsed budget to the table and fix it in the long term and not the short term. >> this one struck me today because it got us thinking to the young people in the country and what the message the congress is sending to the young people. in is an 18-year-old going to george washington university who wanted to work in government some day and thinking of giving up on that dream, because she is so frustrated, and this is a little piece of what she says. >> my new year's message to washington is that the entire flif pr fiscal cliff is not just isolated. it is a symbol of how
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isolationism and polarization has taken over congress. >> and there were some quotes who would like us to actually go over the cliff, and i brought you some of those, but by and large, very few of them. i haven't gotten to twitter, but look at the tweets here. this is from dorothy schoenberger who says i hope the republicans responsible in my view. and this one, we could solve this fiscal cliff and budget problems more than congress. this is the type of frustration that people are venting today. a few more of the tweets. this one from randy christian lee, and our founding fathers are turning over in their graves. come 2013, things will never be the same in this country. if we go over the cliff, it is not overnight or massive and drastic, so don't worry about the of night fears. here are a couple more. stop blaming the politicians,
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but the voters who put them all in and expected a different result than the last four years. that is from marc on twitter. one more, lou from congress, big bunch of babies and waiting for the last minute to look like a hero and continual joke. i will tell you that we are hearing from a lot of people, and martin, no doubt that what people are saying is resonating all over the country, and a lot of people are sharing the frustration. vent and send us your ireports to ireport.com and join the discussions on facebook and twitter to josh levs@cnn and if you think we should go over the cliff, and force the country to deal with necessary cuts, we want to hear from you as well. all sides are welcomed, but martin, there are so far very, very few voices who think that what is happening is okay. a vast majori jority of the peo say to bring it to an end and have a resolution by the end of the new year's. >> it is nice for you to have a america's venting point, and
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they can speak to you. appreciate it. it is good to hear. >> all right. some other news and what is ahead for the kcoming week. monday, playboy father hugh hefner is slated to get married again. if new year's nuptials are to his girlfriend who is 60 years younger than him. crystal harris called off the wedding a few days before the ceremony, but she say she's is ready to settle down with her 86-year-old boyfriend. tuesday marks the end of the end, and with that 400 new laws take effect. many of them deal with social media, health care, education, gay rights and child safety. on thursday, it is time to make up your mind on the gift that you are not in love with. that is right, national returns day. more than half a million gifts are expected to be returned by the u.s. postal service alone and others are bound to be regifted it ends up. you know who you are. and on friday, the december